Volume 2 - ElectricCanadian.com

THE BANK DURING THE WAR 343The London office also did its share in the purchase fromtime to time of treasury bills of the British and French Governments,and in September subscribed for shares in the BritishItalian Corporation, Limited, formed to offset German influencesin Italy and to facilitate trade between Italy and theAllies, particularly Great Britain.The movements of the precious metals during the warwill always have an interest for economists. The channelsthrough which they usually pass were, as soon as the warbroke out, either interrupted or closed entirely, while thedisturbance to credit at the same time created an extraordinarydemand, especially for gold, which could be met only bymovements on an unusually large scale.During the first two years of the war, or until October,1916, when dealings in gold in Great Britain were restrictedto those for government account, the London branch of TheCanadian Bank of Commerce undertook a large volume oftransactions in gold, which gave rise to many interestingproblems of exchange and shipping, and in the aggregateinvolved many millions of dollars. Perhaps nothing else so fullyillustrates the international character of the bank's business.The defeat of the German squadron off the FalklandIslands, followed by the sinking of the Dresden off JuanFernandez, freed the Pacific Ocean from the menace of theGerman navy, and it became possible to move the accumula-of the Unitedtion of gold in Australia to the Pacific portsStates and Canada. Accordingly one class of transactionsentered into by the London office of the bank consisted of thepurchase of sovereigns or bar gold in Australia to be shippedto one of the branches on the Pacific Coast, usually SanFrancisco, there to be sold to the United States Mint foraccount of the bank. Another class involved the purchaseof United States eagles or bar gold in London under arrangementwith the Bank of England 1 to release by cable the1Reference has already been made to the facilities which the Bank of Englandhad for such purposes. See page 328.